While many countries have included EVs as an element of transportation policy, their
responses have varied according to their stage of economic development, energy resource
endowments, technological capabilities, and political prioritization of responses to climate
change. In India, a particular set of circumstances that are conducive to a sustainable
mobility paradigm have created an opportunity for accelerated adoption of EVs over ICE
vehicles. These are:
- A relative abundance of exploitable renewable energy resources.
- High availability of skilled manpower and technology in manufacturing and IT software.
- An infrastructure and consumer transition that affords opportunities to apply technologies
to leapfrog stages of development.
- A universal culture that accepts and promotes sharing of assets and resources for the
overall common good.
These circumstances position India to pursue an EV policy which systematically ensures that
India’s EV program keeps pace with the global scale since large economies seem to take
significant steps towards electrification of vehicles. India’s growth prospects create potential
for developing leadership in EV in certain segments. In that sense, the policy will encourage
a path which starts with India-specific characteristics and initiatives for its auto sector,
building towards global relevance and applications. The key objectives of the EV policy are:
- Reduce primary oil consumption in transportation.
- Facilitate customer adoption of electric and clean energy vehicles.
- Encourage cutting edge technology in India through adoption, adaptation, and research
- Improve transportation used by the common man for personal and goods transportation.
- Reduce pollution in cities.
- Create EV manufacturing capacity that is of global scale and competitiveness.
- Facilitate employment growth in a sun-rise sector.
III. CUSTOMIZING INDIA’S EV POLICY TO THE INDIAN AUTO-INDUSTRY TODAY
While India is operating in the same global context as other countries who have adopted an
EV policy, it has a unique mobility pattern which other countries do not share. An EV policy
for India must be tailor made to India’s particular needs. While vehicle growth in India is rapid,
ownership per 1000 population has increased from 53 in 2001 to 167 in 2015, a key
difference between India and other countries and the types of vehicles being used. India
uses a large variety of motorized transport on roads and its auto-segments are quite different
from that of most of the world. Based on the last six years of sales data, the vehicles on
Indian roads are estimated to consist of:
- Two-wheelers: 79% of the total number of vehicles.
- Three-wheelers (passenger and goods), including tempos: 4% of the total number of
- Buses and large goods vehicles like trucks: 3% of the total number of vehicles.
- Economy four-wheelers (cars costing less than ₹1 million): 12% of the total number of
- Premium four-wheelers (cars costing higher than ₹1 million): 2% of the total number of
In India, premium four-wheelers (cars) are only 2% of the total sales.
- However, most
advanced technologies are available in this category in global markets. In the near term, India
should foster early adoption of vehicles by premium customers which will pave the way for
consumer comfort with electrification, raise aspirations for indigenous products and make
advanced technology available in the market.
- The presence of world-class technology will
help India build a world-class ecosystem for high-quality components and subsystems usable
for all kinds of vehicles.
In the longer term, India should establish technological and manufacturing leadership in the
economic segment of the market.
- The prevalence in India of small vehicles such as
two-wheelers, three-wheelers, economy four-wheelers and small goods vehicles is unique
among large countries.
- These small vehicles require a unique set of technological and
industrial capabilities. Here, India has an opportunity to take a leadership role in the
electrification of small vehicles. India’s potential volumes for these vehicles as the nation
grows, lays the foundation for transformational manufacturing and industrial policy.
- That focusses on the development of technological expertise and industrial capabilities in the
production of small electric vehicles which can not only meet domestic demand but can also
place India in a position of global leadership.
- As other countries begin to look at smaller
vehicles with appropriate specifications, India can establish a position of leadership based
on domestic demand.
IV. MAKING EVS ECONOMICALLY VIABLE
The limiting factor of batteries on driving range may be addressed by developing an
ecosystem of fast-charging or swapping of batteries. This can be achieved by creating
requisite infrastructure, possibly even every kilometer, in dense areas. As a result an
important question arises as to what kind of strategy can make EVs, especially small
vehicles, economically viable. The general strategy should address two key variables
affecting the costs of EVs: battery costs and any fiscal policies that either increase the costs
of an ICE vehicle or decrease the costs of an EV.
- Facilitate employment growth in a sun-rise sector.
- Providing charging infrastructure: The limiting factor of batteries on driving range may
be addressed by developing an ecosystem of fast-charging or swapping of batteries, by
creating an infrastructure, maybe even every kilometre, in dense areas. A smaller battery
will lower costs by reducing the total weight of the vehicle, resulting in higher
energy-efficiency and improved ability to upgrade as the technology evolves. Charging
infrastructure can be rolled out on a city by city basis with select cities and regions leading
the transition. This would be consistent with global experience where 33 percent of all EV
sales take place in only 14 cities where charging infrastructure is widespread and
convenient to use. Approaches for creating effective charging infrastructure are outlined
- Increasing efficiency of vehicles: Incentivising developments to increase vehicle
efficiency, thereby reducing energy consumption, can enable to a vehicle to travel the
same distance on a smaller battery pack. Energy efficiency can be enhanced by using
more efficient electric motors [see Appendix II] using better tyres, enhancing the aero
dynamics of the vehicles and reducing its weight. This would reduce battery size needed
for a certain range.
For the second approach, reducing the unit costs of each battery, India can explore several
a. Selecting appropriate battery chemistries: As batteries dominate costs
of electric vehicles, the strategy would be to use battery chemistry with optimized cost and
performance at Indian temperatures. India should encourage manufacturing of such
battery cells in India. India is already making battery packs (cell to pack).
b. Exploring new battery chemistries: Focussing on materials like lithium, manganese,
nickle, cobalt and graphite that are used in batteries and determine its costs. While it is
important to secure mines which produce these materials, India must also obtain these
battery materials through recycling of used batteries and should aim to become the capital
of “urban mining” of used batteries.
- Beyond reducing battery costs, India can explore potential avenues of fiscal support for EVs
to accelerate adoption. The standard approach in other countries to providing fiscal support
to EVs has been direct subsidization. For example, EVs in USA, Europe and China have up
to 40% “all-in” subsidies.
- VI. POLICY FOR CHARGING / SWAPPING
EV charging and battery swapping are two means for providing energy to a vehicle. EVs will
proliferate as charging/swapping infrastructure is set up. India would recognize battery
swapping and battery charging as addressing different segments of vehicles and two equally
valid options that industry may choose to use. Businesses that provide charging/swapping
would be referred to as Energy Operators (EO).
- STANDARDS FOR CHARGERS
An EV uses electricity as fuel which is stored in a battery in the vehicle. The charging can be
done at home using what is called as home-chargers (also referred to as private-chargers) or
public chargers, installed on streets, parking lots, petrol pumps, or any other public charging
space. The chargers are referred to as EV Supply Equipment (EVSE). Public-charging
infrastructure is an important complement to home-chargers. The main EVSE characteristics
that differentiate chargers include,
• Power and voltage levels: the output power range and voltage range supported by an
• AC or DC: whether the output of EVSE is AC or DC; if it is AC, the vehicle needs to have
an on-board charger.
• Type: the output socket and connect or used by an EVSE.
• Mode: the communication protocol between the vehicle and the charger.
VIII. FOCUS ON SMALL AND PUBLIC VEHICLES TO
MAKE EARLY IMPACT
While encouraging the sale of private EVs, India’s focus, at least in the first few years, should
be on small, public and rural transportation. It is possible for India to have a unique impact
and scale early with two-wheelers and three-wheelers, including three-wheeler goods
vehicles. Special attention is needed to get these vehicles to become economically viable
IX. RESEARCH AND DEVELOPMENT AND
It is imperative that India quickly develops strong Research and Development (R&D) capacity
leading to commercialization in EV subsystems.
- The Government will aid R&D grants through
grand challenge, for product-development which could commercialize within one or two or
at the most, three years.
- TRANSFORMING AUTO-ANCILLARIES: A FOCUS ON POWER-ELECTRONICS INDUSTRY AND
ELECTRICITY DISTRIBUTION SYSTEM / IMPACT ON THE GRID
- Finally, EVs use power-electronics extensively. India had an early start of its
power-electronics industry. However, the industry has not kept pace with new
developments that have seen digitization of power-electronics over the last decade. India
would need a new power-electronics industry which can help develop and produce
high-efficiency sub-systems for EV industries. A special thrust is needed to promote such
- Indian power industry needs to be prepared for the EV roll-out. The network must be
geared to minimizing impacts. Some key actions to prepare for greater EV penetration are
demand-side management, dynamic electricity pricing, and vehicle-to-grid technology for
use of EVs as active loads and generators for power demand shaping. ,
- XI. IMPACT OF EVs ON ECONOMIC GROWTH AND
Shifting modes of mobility could launch new business opportunities. These would emerge in
areas such as charging and swapping infrastructure, service, or integrated transport. In India,
energy players have entered the mobility industry, while some traditional power companies
are exploring possibilities in charging infrastructure, and infrastructure companies are seen
entering the battery business.
- LAST-MILE CONNECTIVITY AND RURAL TRANSPORT
Some Indian cities today have metros as public transport and others have bus services.
Many other cities and most towns do not have either.
- The last-mile connectivity in citieswhich have metros/buses is provided by rickshaws/autos. In cities and towns which do not have metros or buses, the only public transport available are rickshaws and autos. Early conversion of these vehicles to electric vehicles using Lithium-ion batteries will provide clean
transport to a large number of people.
India has a lot to gain by converting its ICE vehicles to EVs at the earliest. Its
oil-import bill would considerably reduce.
- ICE vehicles are a major contributor to
pollution in cities and their replacement with EVs will definitely improve air quality.
There is a considerable possibility that we can become leaders in small and public
- India has over 170 million two-wheelers. If we assume that each of
these vehicles uses a little more than half a litre of petrol per day or about 200 litres
per year, the total amount of petrol used by such vehicles is about 34 billion litres.
- At ₹70 per litre, this would cost about ₹2.4 lakh crores. Even if we assume that 50% of
this is the cost of imported crude (as tax and other may be 50%), one may save ₹1.2
lakh crores worth of imported oil.
- There is a real possibility of getting this done in the
next five to seven years. This would however require innovations, a policy regime that
encourages access to latest technologies and a concerted effort by the Indian
industry to achieve global competition through acquiring the necessary scale and
using cutting edge technology.